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Friday, Aug 30, 2002

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Bear run arrested

K. Premkumar

BEARS dominated the initial hours of Thursday's trading. Thereafter, bulls gained control of the day's proceedings. Thursday's market action resulted in reducing the bear count by a considerable margin. The market sentiment reading of tradable counters stands neutral. Bull domination on Friday is likely to change the sentiment reading in their favour. On the contrary, it is likely to change bearish.

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Nifty futures recommendation: September contract opened one point below and went further down by another 5 points. Later on, bulls made a come back and recovered most of their losses. The movement in the September contract was around 6 points. It closed with a loss of one point with respect to Wednesday's close.

Bulls were successful in terminating the downtrend in August contract. The short trade exited with a nominal loss of 2 points. Buy level for the September contract is placed around its last traded value. Hence, bull pressure on Friday is likely to initiate a fresh uptrend in the September contract.

Stock futures recommendation: There were no new entries or exits to the top-10 tradable list. The ranking of the list had a minor change. Hindustan Lever and ITC interchanged their positions.

Bear domination on Friday could be a threat to the uptrend counters in the list. On the other hand, the prevailing downtrend counters in the list are likely to be safe.

Selling opportunities are likely to exist in Digital, Hindustan Lever, ITC and Tata Steel. Buying opportunities are likely to exist in Digital, Hindustan Lever, Satyam Computer, Tata Engg and Tata Steel.

The best bet for Friday's trading is likely to be the selling in Hindustan Lever. Its sell level is placed closer to its last traded price. Bear pressure on Friday is likely to initiate a fresh downtrend in the counter.

Cash segment: The composition as well as the ranking of the top-10 tradable counters remain undisturbed.

Except for the uptrend in Aftek Infosys and Infosys all the other counters in the list are likely to be under threat. Bulls are likely to have opportunity in Digital, Geometric Soft, Polaris Soft and Satyam Computer. Selling opportunities are likely to exist in Hinduja TMT, Mastek, NIIT and VisualSoft.

The best among the above is likely to be the buying in Satyam Computer. The counter is in the sideways mode. Its bullish trigger level is placed quite closer to its current level. Bull move on Friday is likely to initiate the uptrend in the counter.

(Note: All price levels refer to the absolute value of the shares traded on the NSE. There is risk of loss in trading.)

The author is a Chennai-based technical analyst and fund management consultant.

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